Robo-Advisor
InvestingGlossary term
Definition
An automated digital platform that provides algorithm-driven investment management with minimal human supervision. Robo-advisors typically build diversified portfolios based on your risk tolerance and goals, charging much lower fees (0.25-0.50%) than traditional advisors.
Related terms
- PortfolioA collection of financial investments like stocks, bonds, mutual funds, ETFs, and other assets. Diversifying your portfolio helps manage risk.
- Asset AllocationAn investment strategy that balances risk and reward by dividing investments among different asset categories, such as stocks, bonds, and cash, based on goals and risk tolerance.
- Expense RatioThe annual fee that all funds or ETFs charge their shareholders, expressed as a percentage of assets. Lower expense ratios mean more of your money is invested rather than going to fees.
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